Total capital expenditures (“CapEx”) were $78.5 million and $297.7 million for the three and nine months ended September 30, 2016, respectively, in line with the Company’s 2016 CapEx plan.

Net cash provided by operating activities was $123.4 million for the three months ended September 30, 2016. Adjusted EBITDA for the Company was $104.4 million in the third quarter of 2016. For a definition of Adjusted EBITDA and a reconciliation of net income (loss) and net cash provided by (used in) operating activities to Adjusted EBITDA, see “Non-GAAP Financial Measures” below.

“Oasis continues to increase shareholder value by further improving capital efficiency and acquiring assets that allow us to best leverage our operating expertise,” said Thomas B. Nusz, Oasis’ Chairman and Chief Executive Officer. “With well costs of $5.2 million and Wild Basin type curves of 1,550 Mboe, we are positioned to grow volumes considerably across 2017 and 2018.”

Operational and Financial Update

Select operational and financial statistics are in the following table:

Exploration and production (“E&P”) general and administrative expenses (“G&A”) ($ per Boe)

4.31

3.93

4.07

Production taxes (% of oil and gas revenue)

9.3

%

9.0

%

9.5

%

___________________

(1)

For the three months ended September 30, 2016, average sales prices for oil are calculated using total oil revenues, excluding bulk oil sales of $1.9 million, divided by oil production.

(2)

Realized prices include gains or losses on cash settlements for commodity derivatives, which do not qualify for and were not designated as hedging instruments for accounting purposes.

(3)

Cash settlements represent the cumulative gains and losses on the Company’s derivative instruments for the periods presented and do not include a recovery of costs that were paid to acquire or modify the derivative instruments that were settled.

(4)

Natural gas prices include the value for natural gas and natural gas liquids.

G&A totaled $22.8 million in the third quarter of 2016, $22.4 million in the third quarter of 2015 and $21.9 million in the second quarter of 2016. Amortization of stock-based compensation, which is included in G&A, was $5.8 million, or $1.30 per Boe, in the third quarter of 2016 as compared to $6.0 million, or $1.28 per Boe, in the third quarter of 2015 and $6.2 million, or $1.39 per Boe, in the second quarter of 2016. G&A for the Company’s E&P segment totaled $19.2 million in the third quarter of 2016, $18.9 million in the third quarter of 2015 and $17.7 million in the second quarter of 2016.

Interest expense was $31.7 million for the third quarter of 2016 compared to $36.5 million for the third quarter of 2015 and $35.0 million for the second quarter of 2016. Capitalized interest totaled $4.4 million for the third quarter of 2016, $5.1 million for the third quarter of 2015 and $4.8 million for the second quarter of 2016. Cash Interest totaled $33.7 million for the third quarter of 2016, $40.0 million for the third quarter of 2015 and $37.8 million for the second quarter of 2016. For a definition of Cash Interest and a reconciliation of interest expense to Cash Interest, see “Non-GAAP Financial Measures” below.

For the three months ended September 30, 2016, the Company recorded an income tax benefit of $16.7 million, resulting in a 33.0% effective tax rate as a percentage of its pre-tax loss for the quarter. The Company recorded an income tax benefit of $52.5 million, resulting in a 36.9% effective tax rate as a percentage of its pre-tax income for the three months ended June 30, 2016.

For the third quarter of 2016, the Company reported a net loss of $33.9 million, or $0.19 per diluted share, as compared to a net income of $27.1 million, or $0.20 per diluted share, for the third quarter of 2015. Excluding certain non-cash and non-recurring items and their tax effect, Adjusted Net Loss (non-GAAP) was $29.3 million, or $0.17 per diluted share, in the third quarter of 2016, compared to Adjusted Net Income of $12.5 million, or $0.09 per diluted share, in the third quarter of 2015. For a definition of Adjusted Net Income (Loss) and a reconciliation of net income (loss) to Adjusted Net Income (Loss), see “Non-GAAP Financial Measures” below.

Adjusted EBITDA for the third quarter of 2016 was $104.4 million. For a definition of Adjusted EBITDA and a reconciliation of net income (loss) and net cash provided by (used in) operating activities to Adjusted EBITDA, see “Non-GAAP Financial Measures” below.

Capital Expenditures

The following table depicts the Company’s total CapEx by category:

1Q 2016

2Q 2016

3Q 2016

YTD 2016

CapEx ($ in thousands):

E&P

$

47,734

$

73,125

$

31,333

$

152,192

OMS

35,039

52,842

42,085

129,966

OWS

650

—

29

679

Other(1)

4,532

5,320

5,007

14,859

Total CapEx(2)

$

87,955

$

131,287

$

78,454

$

297,696

___________________

(1)

Other CapEx includes such items as administrative capital and capitalized interest.

(2)

CapEx reflected in the table above differs from the amounts shown in the statement of cash flows in the Company’s condensed consolidated financial statements because amounts reflected in the table above include changes in accrued liabilities from the previous reporting period for capital expenditures, while the amounts presented in the statement of cash flows are presented on a cash basis.

Hedging Activity

As of November 7, 2016, the Company had the following outstanding commodity derivative contracts, all of which are priced off of WTI and settle monthly:

Volume in Mbopd

4Q16

1H17

2H17

1H18

2H18

Swaps

Volume

33.0

16.0

14.0

4.0

3.0

Price

$

49.20

$

48.57

$

49.08

$

54.32

$

54.45

Collars

Volume

—

6.0

6.0

—

—

Floor

—

$

45.00

$

45.00

—

—

Ceiling

—

$

53.95

$

53.95

—

—

3-way

Volume

—

6.0

6.0

—

—

Sub Floor

—

$

31.67

$

31.67

—

—

Floor

—

$

45.83

$

45.83

—

—

Ceiling

—

$

59.94

$

59.94

—

—

Total Volume

33.0

28.0

26.0

4.0

3.0

Additionally, the Company has swaps priced off of NYMEX Natural Gas of 6,000 mmbtu/d at a weighted average price of $3.21 in 2017. The September 2016 contracts settled at $3.7 million and will be included in the Company’s fourth quarter 2016 derivative settlements.

Conference Call Information

Investors, analysts and other interested parties are invited to listen to the conference call:

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include the expectations of plans, strategies, objectives and anticipated financial and operating results of the Company, including the Company’s drilling program, production, derivative instruments, capital expenditure levels and other guidance included in this press release. These statements are based on certain assumptions made by the Company based on management’s experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include, but are not limited to, changes in oil and natural gas prices, weather and environmental conditions, the timing of planned capital expenditures, availability of acquisitions, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as the Company’s ability to access them, the proximity to and capacity of transportation facilities, and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting the Company’s business and other important factors that could cause actual results to differ materially from those projected as described in the Company’s reports filed with the SEC.

Any forward-looking statement speaks only as of the date on which such statement is made and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.

About Oasis Petroleum Inc.

Oasis is an independent exploration and production company focused on the acquisition and development of unconventional oil and natural gas resources, primarily operating in the Williston Basin. For more information, please visit the Company’s website at www.oasispetroleum.com.

Common stock, $0.01 par value: 450,000,000 and 300,000,000 shares authorized at September 30, 2016 and December 31, 2015, respectively; 182,038,164 shares issued and 181,186,070 shares outstanding at September 30, 2016 and 139,583,990 shares issued and 139,076,064 shares outstanding at December 31, 2015

1,779

1,376

Treasury stock, at cost: 852,094 and 507,926 shares at September 30, 2016 and December 31, 2015, respectively

(15,895)

(13,620)

Additional paid-in capital

1,755,427

1,497,065

Retained earnings

646,193

834,521

Total stockholders’ equity

2,387,504

2,319,342

Total liabilities and stockholders’ equity

$

5,398,261

$

5,649,375

Oasis Petroleum Inc.

Condensed Consolidated Statement of Operations

(Unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2016

2015

2016

2015

(In thousands, except per share data)

Revenues

Oil and gas revenues

$

158,183

$

175,270

$

434,835

$

563,239

Well services and midstream revenues

19,128

21,965

51,839

44,429

Total revenues

177,311

197,235

486,674

607,668

Operating expenses

Lease operating expenses

35,696

35,670

98,283

112,556

Well services and midstream operating expenses

8,165

10,023

21,429

19,370

Marketing, transportation and gathering expenses

8,856

8,465

23,899

23,313

Production taxes

14,638

16,676

39,758

53,915

Depreciation, depletion and amortization

111,948

123,734

356,885

361,430

Exploration expenses

489

327

1,192

2,252

Rig termination

—

—

—

3,895

Impairment

382

80

3,967

24,917

General and administrative expenses

22,845

22,358

69,087

67,190

Total operating expenses

203,019

217,333

614,500

668,838

Gain (loss) on sale of properties

6

172

(1,305)

172

Operating loss

(25,702)

(19,926)

(129,131)

(60,998)

Other income (expense)

Net gain (loss) on derivative instruments

20,847

103,637

(55,624)

111,285

Interest expense, net of capitalized interest

(31,726)

(36,513)

(105,444)

(112,702)

Gain (loss) on extinguishment of debt

(13,793)

—

4,865

—

Other income (expense)

(259)

249

188

370

Total other income (expense)

(24,931)

67,373

(156,015)

(1,047)

Income (loss) before income taxes

(50,633)

47,447

(285,146)

(62,045)

Income tax benefit (expense)

16,691

(20,392)

96,818

17,829

Net income (loss)

$

(33,942)

$

27,055

$

(188,328)

$

(44,216)

Earnings (loss) per share:

Basic

$

(0.19)

$

0.20

$

(1.09)

$

(0.35)

Diluted

(0.19)

0.20

(1.09)

(0.35)

Weighted average shares outstanding:

Basic

177,120

137,014

172,360

127,827

Diluted

177,120

137,014

172,360

127,827

Oasis Petroleum Inc.

Selected Financial and Operational Statistics

(Unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2016

2015

2016

2015

Operating results (in thousands):

Revenues

Oil

$

148,962

$

169,672

$

413,068

$

542,049

Natural gas

9,221

5,598

21,767

21,190

Well services

10,641

15,381

29,459

27,308

Midstream

8,487

6,584

22,380

17,121

Total revenues

$

177,311

$

197,235

$

486,674

$

607,668

Production data:

Oil (MBbls)

3,628

4,077

11,245

12,107

Natural gas (MMcf)

5,007

3,438

13,809

9,940

Oil equivalents (MBoe)

4,463

4,650

13,547

13,764

Average daily production (Boe per day)

48,509

50,546

49,440

50,418

Average sales prices:

Oil, without derivative settlements (per Bbl)(1)

$

40.54

$

41.61

$

36.57

$

44.77

Oil, with derivative settlements (per Bbl)(1)(2)

43.79

60.77

46.85

68.84

Natural gas (per Mcf)(3)

1.84

1.63

1.58

2.13

Costs and expenses (per Boe of production):

Lease operating expenses

$

8.00

$

7.67

$

7.26

$

8.18

Marketing, transportation and gathering expenses(4)

1.58

1.63

1.58

1.64

Production taxes

3.28

3.59

2.93

3.92

Depreciation, depletion and amortization

25.08

26.61

26.35

26.26

General and administrative expenses (“G&A”)

5.12

4.81

5.10

4.88

Exploration and production G&A

4.31

4.07

4.28

4.43

___________________

(1)

For both the three and nine months ended September 30, 2016, average sales prices for oil are calculated using total oil revenues, excluding bulk oil sales of $1.9 million, divided by oil production.

(2)

Realized prices include gains or losses on cash settlements for commodity derivatives, which do not qualify for and were not designated as hedging instruments for accounting purposes. Cash settlements represent the cumulative gains and losses on the Company’s derivative instruments for the periods presented and do not include a recovery of costs that were paid to acquire or modify the derivative instruments that were settled.

(3)

Natural gas prices include the value for natural gas and natural gas liquids.

Cash Interest is a supplemental non-GAAP financial measure that is used by management and external users of the Company’s financial statements, such as industry analysts, investors, lenders and rating agencies. The Company defines Cash Interest as interest expense plus capitalized interest less amortization and write-offs of deferred financing costs included in interest expense. Cash Interest is not a measure of interest expense as determined by United States generally accepted accounting principles, or GAAP.

The following table presents a reconciliation of the GAAP financial measure of interest expense to the non-GAAP financial measure of Cash Interest for the periods presented:

Three Months Ended September 30,

Nine Months Ended September 30,

2016

2015

2016

2015

(In thousands)

Interest expense

$

31,726

$

36,513

$

105,444

$

112,702

Capitalized interest

4,380

5,054

13,683

13,830

Amortization of deferred financing costs

(2,095)

(1,570)

(8,042)

(5,527)

Amortization of debt discount

(300)

—

(300)

—

Cash Interest

$

33,711

$

39,997

$

110,785

$

121,005

Adjusted EBITDA and Free Cash Flow are supplemental non-GAAP financial measures that are used by management and external users of the Company’s financial statements, such as industry analysts, investors, lenders and rating agencies. The Company defines Adjusted EBITDA as earnings before interest expense, income taxes, depreciation, depletion, amortization, exploration expenses and other similar non-cash or non-recurring charges. The Company defines Free Cash Flow as Adjusted EBITDA less Cash Interest and CapEx, excluding capitalized interest. Adjusted EBITDA and Free Cash Flow are not measures of net income (loss) or cash flows as determined by United States generally accepted accounting principles, or GAAP.

The following table presents reconciliations of the GAAP financial measures of net income (loss) and net cash provided by (used in) operating activities to the non-GAAP financial measures of Adjusted EBITDA and Free Cash Flow for the periods presented:

Three Months Ended September 30,

Nine Months Ended September 30,

2016

2015

2016

2015

(In thousands)

Net income (loss)

$

(33,942)

$

27,055

$

(188,328)

$

(44,216)

(Gain) loss on sale of properties

(6)

(172)

1,305

(172)

(Gain) loss on extinguishment of debt

13,793

—

(4,865)

—

Net (gain) loss on derivative instruments

(20,847)

(103,637)

55,624

(111,285)

Derivative settlements(1)

11,786

78,100

115,576

291,436

Interest expense, net of capitalized interest

31,726

36,513

105,444

112,702

Depreciation, depletion and amortization

111,948

123,734

356,885

361,430

Impairment

382

80

3,967

24,917

Rig termination

—

—

—

3,895

Exploration expenses

489

327

1,192

2,252

Stock-based compensation expenses

5,782

5,966

18,761

19,629

Income tax (benefit) expense

(16,691)

20,392

(96,818)

(17,829)

Other non-cash adjustments

(26)

883

697

782

Adjusted EBITDA

104,394

189,241

369,440

643,541

Cash Interest

(33,711)

(39,997)

(110,785)

(121,005)

Capital expenditures(2)

(78,453)

(78,053)

(297,696)

(519,566)

Capitalized interest

4,380

5,054

13,683

13,830

Free Cash Flow

$

(3,390)

$

76,245

$

(25,358)

$

16,800

Net cash provided by operating activities

$

32,018

$

50,451

$

123,419

$

280,337

Derivative settlements(1)

11,786

78,100

115,576

291,436

Interest expense, net of capitalized interest

31,726

36,513

105,444

112,702

Rig termination

—

—

—

3,895

Exploration expenses

489

327

1,192

2,252

Deferred financing costs amortization and other

(3,622)

(2,409)

(10,174)

(7,468)

Changes in working capital

32,023

25,376

33,286

(40,395)

Other non-cash adjustments

(26)

883

697

782

Adjusted EBITDA

104,394

189,241

369,440

643,541

Cash Interest

(33,711)

(39,997)

(110,785)

(121,005)

Capital expenditures(2)

(78,453)

(78,053)

(297,696)

(519,566)

Capitalized interest

4,380

5,054

13,683

13,830

Free Cash Flow

$

(3,390)

$

76,245

$

(25,358)

$

16,800

___________________

(1)

Cash settlements represent the cumulative gains and losses on the Company’s derivative instruments for the periods presented and do not include a recovery of costs that were paid to acquire or modify the derivative instruments that were settled.

(2)

CapEx reflected in the table above differs from the amounts shown in the statement of cash flows in the Company’s condensed consolidated financial statements because amounts reflected in the table above include changes in accrued liabilities from the previous reporting period for capital expenditures, while the amounts presented in the statement of cash flows are presented on a cash basis.

The following tables present reconciliations of the GAAP financial measure of income (loss) before income taxes to the non-GAAP financial measure of Adjusted EBITDA for the Company’s three reportable business segments on a gross basis for the periods presented:

Exploration and Production

Three Months Ended September 30,

Nine Months Ended September 30,

2016

2015

2016

2015

(In thousands)

Income (loss) before income taxes

$

(66,333)

$

29,070

$

(331,075)

$

(104,102)

(Gain) loss on sale of properties

(6)

(172)

1,663

(172)

(Gain) loss on extinguishment of debt

13,793

—

(4,865)

—

Net (gain) loss on derivative instruments

(20,847)

(103,637)

55,624

(111,285)

Derivative settlements(1)

11,786

78,100

115,576

291,436

Interest expense, net of capitalized interest

31,726

36,513

105,444

112,702

Depreciation, depletion and amortization

109,668

122,075

346,240

357,664

Impairment

382

80

1,536

24,917

Rig termination

—

—

—

3,895

Exploration expenses

489

327

1,192

2,252

Stock-based compensation expenses

5,570

5,761

17,495

19,276

Other non-cash adjustments

(26)

883

697

782

Adjusted EBITDA

$

86,202

$

169,000

$

309,527

$

597,365

___________________

(1)

Cash settlements represent the cumulative gains and losses on the Company’s derivative instruments for the periods presented and do not include a recovery of costs that were paid to acquire or modify the derivative instruments that were settled.

Well Services

Three Months Ended September 30,

Nine Months Ended September 30,

2016

2015

2016

2015

(In thousands)

Income before income taxes

$

1,577

$

10,950

$

3,462

$

29,588

Depreciation, depletion and amortization

3,478

4,904

11,605

14,430

Stock-based compensation expenses

354

544

1,253

1,530

Adjusted EBITDA

$

5,409

$

16,398

$

16,320

$

45,548

Midstream Services

Three Months Ended September 30,

Nine Months Ended September 30,

2016

2015

2016

2015

(In thousands)

Income before income taxes

$

16,065

$

18,828

$

49,262

$

44,039

Gain on sale of properties

—

—

(358)

—

Depreciation, depletion and amortization

1,909

1,509

5,325

4,070

Impairment

—

—

2,431

—

Stock-based compensation expenses

218

206

661

529

Adjusted EBITDA

$

18,192

$

20,543

$

57,321

$

48,638

Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) Per Share are supplemental non-GAAP financial measures that are used by management and external users of the Company’s financial statements, such as industry analysts, investors, lenders and rating agencies. The Company defines Adjusted Net Income (Loss) as net income (loss) after adjusting first for (1) the impact of certain non-cash and non-recurring items, including non-cash changes in the fair value of derivative instruments, impairment, and other similar non-cash and non-recurring charges, and then (2) the non-cash and non-recurring items’ impact on taxes based on the Company’s effective tax rate applicable to those adjusting items in the same period. Adjusted Net Income (Loss) is not a measure of net income (loss) as determined by GAAP. The Company defines Adjusted Diluted Earnings (Loss) Per Share as Adjusted Net Income (Loss) divided by diluted weighted average shares outstanding.

The following table presents reconciliations of the GAAP financial measure of net income (loss) to the non-GAAP financial measure of Adjusted Net Income (Loss) and the GAAP financial measure of diluted earnings (loss) per share to the non-GAAP financial measure of Adjusted Diluted Earnings (Loss) Per Share for the periods presented:

Three Months Ended September 30,

Nine Months Ended September 30,

2016

2015

2016

2015

(In thousands, except per share data)

Net income (loss)

$

(33,942)

$

27,055

$

(188,328)

$

(44,216)

(Gain) loss on sale of properties

(6)

(172)

1,305

(172)

(Gain) loss on extinguishment of debt

13,793

—

(4,865)

—

Net (gain) loss on derivative instruments

(20,847)

(103,637)

55,624

(111,285)

Derivative settlements(1)

11,786

78,100

115,576

291,436

Impairment

382

80

3,967

24,917

Rig termination

—

—

—

3,895

Amortization of deferred financing costs(2)

2,095

1,570

8,042

5,526

Amortization of debt discount

300

—

300

—

Other non-cash adjustments

(26)

883

697

782

Tax impact(3)

(2,798)

8,668

(67,598)

(80,447)

Adjusted Net Income (Loss)

$

(29,263)

$

12,547

$

(75,280)

$

90,436

Diluted loss per share

$

(0.19)

$

0.20

$

(1.09)

$

(0.35)

(Gain) loss on sale of properties

—

—

0.01

—

(Gain) loss on extinguishment of debt

0.08

—

(0.03)

—

Net (gain) loss on derivative instruments

(0.12)

(0.76)

0.32

(0.87)

Derivative settlements(1)

0.07

0.57

0.67

2.28

Impairment

—

—

0.02

0.19

Rig termination

—

—

—

0.03

Amortization of deferred financing costs(2)

0.01

0.01

0.05

0.04

Amortization of debt discount

—

—

—

—

Other non-cash adjustments

—

0.01

—

0.01

Tax impact(3)

(0.02)

0.06

(0.39)

(0.62)

Adjusted Diluted Earnings (Loss) Per Share

$

(0.17)

$

0.09

$

(0.44)

$

0.71

Diluted weighted average shares outstanding

177,120

137,014

172,360

127,827

Effective tax rate applicable to adjustment items

37.4

%

37.4

%

37.4

%

37.4

%

___________________

(1)

Cash settlements represent the cumulative gains and losses on the Company’s derivative instruments for the periods presented and do not include a recovery of costs that were paid to acquire or modify the derivative instruments that were settled.

(2)

As of September 30, 2016, Adjusted Net Income (Loss) includes the non-cash adjustment for amortization of deferred financing costs. Comparative periods have been conformed. The amortization of deferred financing costs are included in interest expense on the Company’s Condensed Consolidated Statement of Operations. For the nine months ended September 30, 2016 and 2015, the amortization of deferred financing costs included $1.8 million and $0.5 million, respectively, for unamortized deferred financing costs related to the revolving credit facility, which were written off in proportion to the decreases in the borrowing base.

(3)

The tax impact is computed utilizing the Company’s effective tax rate applicable to the adjustments for certain non-cash and non-recurring items.